Professional Documents
Culture Documents
Learning Objectives
1. What is international business? 2. What are the key concepts in international trade and investment? 3. How does international business differs from domestic
business?
4. Who participates in international business? 5. Why do firms pursue internationalization strategies? 6. Why should you study international business?
Definition: Performance of trade and investment activities by firms across national borders.
Internationalization of Business
Companies conduct value-adding activities on a global scale, i.e. organize, source, manufacture, market, etc.
originate.
Globalization of production
(2)
Citibank, Deutsche Bank, BNP Paribas, and other international banks are thriving because of high oil prices, booming consumer banking, and low taxes. Banks bypass Islamic rules against paying interest by structuring loans as partnerships.
International Business: Strategy, Management, and the New Realities
Cross-Cultural Risk
Differences in language, lifestyles, attitudes, customs, and religion, where a cultural miscommunication jeopardizes a culturally-valued mindset or behavior. Cultural blunders- hinder the effectiveness of foreign managers.
reduced.
Commercial Risk
Less than optimal formulation and/or implementation of strategies, tactics or procedures, e.g. partnering selections, market entry timing, pricing, product features, and promotional themes
6. Participants in IB
Multinational enterprise (MNE): A large company with substantial resources that performs various business activities through a network of subsidiaries and affiliates located in multiple countries. In addition to a home office, an MNE owns a worldwide network of subsidiaries. Examples- Caterpillar, Kodak, Nokia, Samsung, Unilever, Citibank, Vodafone, Carrefour, Bechtel, Four Seasons Hotels, Disney, DHL, & Nippon Life Insurance. Examples of Fortunes Global 500- Exxon Mobil, Royal Dutch Shell, BP,
NGOs
Non-governmental Organizations (NGOs) They serve special causes, the arts, education, politics, religion and research. Examples:
production
partner
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Building factories abroad often leads to job losses in the home country.